CASE
STUDY
TOMS shoes
Brief Intro................................................................................................................................................. 1
Part one (7 minutes) ................................................................................................................................ 1
Part Two (7 minutes) ............................................................................................................................... 2
The societal challenge ......................................................................................................................... 2
Presentation Video .............................................................................................................................. 2
Business model .................................................................................................................................... 3
Success factors .................................................................................................................................... 3
Part Three – Group Exercise (15 minutes) .............................................................................................. 4
Brief Intro
The case study is divided into three sections. The first two (definitions and the presentation of the
social innovation) are presented by the volunteer. Part two contains also a video, which is a very
important element of the case study, and which should be introduced to the students. Based on what
they hear from the volunteer, and what they see on the video, they can get prepared for the last part,
part three, which is the group exercise.
Part one (7 minutes)
Social Innovations
• Are solutions that adress social needs
• Sectors: Education, Health, Social Inclusion, Livelihood
development, Sustainability
Social Enterprise
• Social enterprises are socially driven organizations that
apply market-based strategies to achieve a social
purpose, often referred to as the triple bottom line
( people, planet, profit)
Social Entrepreneur
• Is an individual who recognizes a social problem and
uses entrepreneurial principles tocreate a buiness and
positive social change
Part Two (7 minutes)
The societal challenge
TOMS is a for-profit business that designs and
manufactures shoes for distribution all around
the world. The company also has a very strong
component, donating shoes to kids in need;
therefore it is also considered a successful social
enterprise.
The company was started by Blake Mycoskie after
he witnessed the poverty among villagers in
Argentina. The poverty was so extreme that the
villagers could not even afford a pair of shoes.
Kids not wearing shoes not only risk getting all kind of diseases, but also they are not allowed to
attend school. The organization that Mycoskie’s built consists of two parts:
1. (TOMS shoes is a for profit company that manages the overall operations and logistics of
shoe production
2. Friends of TOMS, the company’s non-profit subsidiary, which is responsible for organizing
volunteer activities and all shoe drops (giving). The company’s ultimate vision is to
demonstrate the effect on how working together as a society can “create a better tomorrow
by taking compassionate action today.”
During its first year of business, 2006, TOMS donated 10,000 shoes to children living in Argentina.
Since then TOMS has expanded its shoes distribution in other regions of the world and in 2010
donated 1,000,000 shoes to 24 nations around the world.
Presentation Video (3min)
Link
Business model (15min)
The TOMS (www.toms.com ) business model is revolutionary and unusual in that the social
component is just as important as the for-profit business. Here’s how it works: when a customer
purchases a pair of TOMS’ shoes, a child in a disadvantaged community will receive a pair of shoes
approximately four to six months from the initial date of purchase. This is the one-to-one model. The
kids are chosen identified by Friends of TOMS.
 Success Factors

1 Customer buys one pair of shoes
1 Child receives one pair of shoes
The cost of providing shoes to the children in need is built into the shoes’ sales price. The customer
thereby becomes the (albeit indirect) benefactor, enabling TOMS to become a sustainable
organization based on giving back to the world on a continuous basis
Buyer
Benefactor
(Donor)
Nonprofit organizations that depend largely on donations struggle to remain in operation during
economic downturns. By incorporating the nonprofit component into the business model, TOMS
mitigates the risk of running out of business, as long as customers keep buying TOMS’ shoes The One
to One model enables the social enterprise to remain in operation because the shoes sold cover the
extra shoes for the kids in need and for the shoe drops (shoe giving) days. If the entrepreneur would
have opted for a model where customers donate money to the kids, it would have been a one-time
deal. The Founder of TOMS wanted to find a sustainable way in which he could create continual
opportunities for those in needs as long as the company remained in business. Therefore, the
customer also benefits of the products he/she buys, and can see the direct positive impact he/she is
creating by purchasing the shoes.
Success factors
One market trend that contributed to the success of TOMS is that customers are becoming
increasingly social conscious; therefore the target market is growing. This means that customers see
the direct effect of their donation, and they realize the difference they are making. TOMS was
successful because he successfully built the social aspect into his business model.
Passionate people represent another success factor. When the business started, TOMS did not have
a lot of money to pay individuals. The company instead hired on individuals who were passionate
about its mission. Due to the lack of money, they hired recent college
graduates and even high school graduates. Employees and interns
were highly motivated by the fact that their work is supporting a good
cause, and they can experience it themselves.
Another success factor was the use of social media. TOMS does not
have a marketing budget. Instead the company focuses on word-ofmouth, viral marketing, and social networks for its marketing efforts.
Each pair of shoes comes out with a TOMS’s flag and a small card asking their customers to take
pictures of themselves wearing their new shoes and holding up the flag.
Part Three – Group Exercise (10 minutes)
(The students will be divided into groups of 3-5, and will be given these
questions. They have 10 minutes to try to come up with the answers.
Afterwards, they will discuss the answers with the volunteer, for another
10 minutes)
1. Idea generation: What was the trigger of the idea?
Answer: The ideas was triggered by the fact that kids in Argentina were so poor they didn’t
have shoes, and due to this they were victims of different diseases and could not attend
school.
2. Which is the target market?
Answer: TOMS target customers who are socially responsible, who have a developed civic
attitude and they want help a social cause.
3. Value proposition: Which is the main benefit of the social innovation for the social cause
identified, in this case poverty?
Answer: The main benefit of the social innovation is that kids in need receive free shoes. This
is possible due to the willingness of the customers, and the business model of TOMS. “Onefor-one” is simple and straightforward message, which get a lot of buy-in.
4. What is the social innovation behind the model?
Answer: The social innovation is the innovative business model that allows the customer to
directly support a child who will receive a pair of shoes. Therefore, the “One-for-one” model is
the social innovation behind TOMS.